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Procurement decisions don’t fail inside procurement. They fail when real-world conditions hit them. That’s what we assess.
Public Sector Procurement Practice and the Principles of External Economies, Clustering and the Global Value Chain
Can the public sector effectively apply the principles of External Economies to its procurement practice? “External economies of scale (ES) occur outside of a firm, within an industry. Thus, when an industry’s scope of operations expands due to, for example, the creation of a better transportation network, resulting in a subsequent decrease in costs for […]
Posted in: Procurement Trends
The Point of Ideal Price Viability (Graphic Illustrations)
August 27, 2007
I would like to once again thank everyone for their response to and questions regarding my recent postings on the Point of Ideal Price Viability (PIPV). Of the e-mails I received pertaining to the Supplemental Material post, many asked me to provide examples of the individual transactions that formed part of the amalgam or averages […]
Posted in: Procurement Trends
(Supplemental Material) Double Marginalization and the Point of Ideal Price Viability
August 23, 2007
I have received a number of e-mails regarding my August 10th posting (Double Marginalization and the Point of Ideal Price Viability) requesting clarification of my theory. In line with the old saying that a “picture is worth a thousand words,” the following graph will hopefully illustrate the basis for my conclusions. (NOTE: due to space […]
Posted in: Procurement Trends
CNN drops the ball with $1 million DoD washer purchase story by Jon Hansen
August 20, 2007
Update April 4th, 2014: It is interesting but this story from 2007 has recently seen a spike in reads which leads one to wonder why? The bigger question of course still remains the same . . . does the media sensationalizing these events help or hurt the investigation and resolution process. Specifically, does it become […]
Posted in: Defence Procurement
DoD procurement practice then and now: A public versus private sector comparison (Part 1)
August 16, 2007
Hard evidence is needed to provide an accurate gauge of DoD spending efficiency. This study which examines DoD spending on specific items shows that DoD spends significantly less than their private sector counterparts on similar items. These findings question the widely-held beliefs about the inherent inferiority and inefficiency of DoD purchasing practices. The findings also […]
Posted in: Defence Procurement
Double Marginalization and the Point of Ideal Price Viability
August 10, 2007
Referencing my last post (Double Marginalization and the Decentralized Supply Chain, August 9, 2007) double marginalization “DM” is defined as the “exercise of market power at successive vertical layers in a supply chain.” The problem that arises as a result of DM is tied to an impetus to mark up the product’s price above marginal […]
Posted in: Procurement Trends
Double Marginalization and the Decentralized Supply Chain by Jon Hansen
August 9, 2007
Double marginalization is defined as the “exercise of market power at successive vertical layers in a supply chain.” Dating back to Lerner (1934) the problem that arises as a result of double marginalization is tied to an impetus to mark up the product’s price above marginal cost. According to a 2005 Caltech paper (Vertical Integration […]
Posted in: Commentary, Procurement Trends
Procurement’s expanding role and the executive of the future
August 3, 2007
In 2006 CPO Agenda’s London-based editor chaired a panel discussion asking the question “are there any limits to procurement’s role?” The panel which included senior procurement personnel from organizations such as Nestlé, Danone, British Airways and Merrill Lynch provided some interesting insights into the prevailing (and emerging) attitudes towards procurement from an executive suite perspective. […]
Posted in: Procurement Trends
Technology and the Growing Talent Crunch!
August 1, 2007
A debate of reasonable fury has been raging since the Bureau of Labor Statistics released their latest report on procurement sector job growth. The primary point of contention is the BLS’ assertion that the “overall employment for purchasing and supply managers is expected to grow slower than the average for all occupations through the year […]
Posted in: News & Updates
The Greening of Procurement (Part 2): It’s not easy being Green!
July 26, 2007
Are environmental considerations truly the central element of recently emerging green programs, or are they an advantageous, politically correct by-product of an existing strategy that is linked to more “traditional” motives? While the EcoMarkets 2007 Survey adroitly provided us with an unbiased look into the mindset of the purchaser, the attitude (and actions) of vendors […]
Posted in: Green Procurement
Procurement Insights 
August 28, 2007
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